This paper examines aggregate savings in a general equilibrium model where infinitely lived households face volatile … (and possibly uncertain) income paths, hold a risk-free asset, and face a liquidity constraint. I first show that the … when income is constant. This additional capital accumulation has sometimes been interpreted as precautionary savings, but …

Guided by a simple theory of task assignment and time allocation, we investigate the long run response to national … differences in tax rates on labor income, payrolls and consumption. The theory implies that higher tax rates reduce work time in …